Japanese indie distributors cling to life

Others may follow Wise Policy's May bankruptcy

TOKYO -- Japanese distributors of independent films, particularly overseas titles, are feeling the pain. Rumors are flying around about who may go to the wall next, and questions being raised as to the viability of the current business model.

Since news broke last month of distributor Wise Policy's bankruptcy filing, speculation has been rife as to which indie distributors might follow in its footsteps.

The sector is being battered from all sides: a drop in boxoffice for foreign films overall, domestic and foreign blockbusters cornering more of the market than ever and the decline of single-screen art house theaters, all against the backdrop of an economy that shrunk over 15% year-over-year in the last quarter.

Around the turn of the millennium there was something of an art house boom in Japan, and theaters and distributors expanded in response. "At one time, watching mini-theater movies was trendy, renting unreleased movies was trendy, but not now," said an insider at an independent distributor.

Xanadeux, a distributor and producer and the company behind Takashi Shimizu's "Ju-on" movies -- remade into "The Grudge" series -- is in serious trouble. "New York, I Love You" remains on the company's Web site as a 'coming soon' title, but the Japanese rights were being offered at Cannes.

The company was also due to be distributing "Kanikosen" ("The Crab-Canning Ship") and "Onnanoko Monogatari" ("Girl's Story"), but IMJ Entertainment, the production company for both movies, has now taken over distribution duties.

"Most of the independent distributors are in a bad way," said Chiaki Nagasawa from IMJ's distribution division, "and this is the first time we've had to act as distributor."

"As for foreign films, compared to before, there's less interest, and with the minimum guarantees having hardly come down -- it's difficult to make them pay," Nagasawa said.

A staffer at Movie-Eye Entertainment insisted the company is still operating and will release the Oscar-nominated "Baader Meinhof Complex" as scheduled, despite stories circulating about its imminent demise.

Another independent, Hexagon Pictures, followed the Japanese trend at Cannes in May by not making a single acquisition at market, and is also believed to be struggling somewhat in the current harsh conditions.

One of those that seems to be weathering the storm is Klock Worx, which has revenue from anime hits like "Evangelion" to help keep its balance sheet healthy.

Asmik Ace, more of a mini-major than an independent, is also involved in producing anime, as well as live-action movies such as the upcoming adaptation of Haruki Murakami's "Norwegian Wood" with Fuji TV, and Japan's first full-length 3D feature, the recently-announced "Shock Labyrinth" ("Senritsu Meikyu.") Directed by Takashi Shimizu ("The Grudge"), and based on a haunted house attraction at an amusement park near Tokyo, the movie will be largely shot there, and is due for an October release.

With its more diversified business model, larger size and corporate backing, Asmik looks better positioned than most to survive the upheaval.

The specialist distributor of independent films could soon be an endangered species in Japan. As one staffer, on the news of a rival's troubles, put it, "There's a saying in Japanese, 'asu wa wagami' -- any one of us could be like them tomorrow."
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